How to Spend Down a Health FSA Before the Money Expires

Open enrollment season is when many people notice there is still money sitting in their health flexible spending account. The usual assumption is that whatever is left rolls into next year. It does not. Under the use-it-or-lose-it rule, any balance left after the plan deadline goes back to the employer, unless the plan has one of two limited exceptions.

Find your plan's deadline and its one exception

Log in to your FSA administrator's site or read the summary plan description from your benefits team. HealthCare.gov explains that an employer may offer either a grace period of up to 2½ extra months to spend the money, or a carryover of a limited amount into the next year, but not both. Some plans offer neither. For plan years beginning in 2026, Revenue Procedure 2025-32 caps the carryover at $680. Write down two dates: the last day care can happen, and the last day a claim can be filed. The second is often later.

Claim what you already paid for

Check the balance, then look back through the year for expenses you paid out of pocket and never submitted: copays, prescriptions, dental bills, glasses. IRS Publication 969 says the plan needs a written statement from an independent third party showing the expense and its amount, plus your statement that no other coverage paid it. An itemized receipt or your insurer's explanation of benefits usually does this. A card swipe without a receipt is a common reason a claim is held.

Book care you need before the deadline

The account reimburses expenses incurred during the period of coverage, so the visit or purchase has to happen in time, not just the payment. Good candidates are things you would buy anyway: an eye exam, new glasses or contacts, a dental cleaning or filling, a prescription refill. IRS Publication 502 lists what counts as a medical expense, including eye exams, eyeglasses, contact lenses and dental treatment. If you are unsure about an item, check your administrator's eligible expense list before buying it.

Elect next year's amount on purpose

Your FSA election does not repeat on its own, so choose an amount during open enrollment. Publication 969 says the amount is set at the start of the plan year and can change only when the law and the plan allow it. The 2026 limit is $3,400 per employee. Base the new figure on the predictable costs from this year's claims, not a round number.

If a claim is denied. Resubmit with an itemized receipt showing the provider, the date of service, what was provided and the amount. Most denials are missing paperwork, not ineligible care.

If your plan has a carryover. Anything above the carryover cap is still forfeited, so spend or claim the excess before the deadline.

Sources. Revenue Procedure 2025-32, IRS Publication 969, IRS Publication 502, HealthCare.gov flexible spending accounts.